What changed
RBI notified that The Ganesh Bank of Kurundwad Ltd was removed from the Second Schedule to the RBI Act, 1934, effective 21 October 2006. The exclusion was based on a prior notification published in the Gazette of India on 26 September 2006.
What it means for you
For the banking sector, this exclusion means the bank is no longer a scheduled commercial bank, losing access to RBI's liquidity facilities and certain privileges. Other banks and lenders should note that counterparty risk for this entity may have increased, and any exposures need careful review.
What you must do
- Verify if your bank has any outstanding exposure to The Ganesh Bank of Kurundwad Ltd and assess credit risk accordingly.
- Update internal records to reflect that this entity is no longer a scheduled bank for regulatory reporting.
- Review any interbank transactions or guarantees involving this bank and consider collateral requirements.
- Monitor RBI notifications for similar exclusions that may affect your counterparty list.
Who it affects
All scheduled commercial banks with interbank dealings with The Ganesh Bank of Kurundwad Ltd, Lenders and counterparties exposed to this bank, RBI's regulatory and supervisory teams
What does exclusion from the Second Schedule mean?
It means the bank loses its status as a scheduled commercial bank under the RBI Act, 1934, which affects its eligibility for RBI's liquidity support and certain statutory benefits.
When did this exclusion take effect?
The exclusion was effective from 21 October 2006, the date the related notification was published in the Gazette of India.
Should we continue transacting with this bank?
Exercise caution. The bank is no longer a scheduled entity, so its regulatory standing is diminished. Review your credit policies and risk management frameworks before any new transactions.